Segmentation and Targeting Based on Social Architecture · Social segmentation and targeting...

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Segmentation and Targeting Based on Social Architecture Leveraging Peer Relationships for Your Stakeholder Management

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SEGMENTATION AND TARGETING

Traditional segmentation and targeting models ignore a major dimension for messaging success

For decades, pharmaceutical companies have created sophisticated market

segmentation models to identify relevant stakeholders. These were based on multiple

criteria, such as geography, functions and roles of stakeholders, groups of interest,

and of course impact.

In today’s increasingly connected world, traditional segmentation models miss a

dimension that is essential to optimally driving your stakeholder management: the social

dimension. The need for an innovative, social insight-based approach is extremely

evident when it comes to marketing new products, like advanced electric cars.

The traditional approach would try to identify the demographic segment most suitable

for the type of car. But imagine if you could identify the four colleagues that regularly

discuss automotive technology over lunch and tailor a message aligned with their

specific discussion on the innovative new electric engine and power supply of the car.

Social architecture as a new way to understand the market dynamics

Network logic strongly suggests that within a tight group

of people, in the long run, one single opinion will dominate

in the group. Why does this happen? Social networks

establish trusted communication paths. The credibility

inherent in these connections is the basis of forming and

adapting new opinions—an outsider simply will not have

the same sway within the community. By gaining insights

about the social architecture of your target group, you can

better tailor your messaging.

To describe and analyze the social architecture,

we characterize the network mainly based on three

topological measures (figure 2):

• Clustering: How many (independent) social sub-segments exist within the market?

• Centrality: How central are the key players positioned within the market?

• Structure of power: How is power distributed among individuals and sub groups within the network?

Social architecture as a new way to understand the market dynamics Network logic strongly suggests that within a tight group of people, on the long run one single opinion will dominate in the group. And in a competitive situation, you better make sure that this favors your goals! Why does this happen? Social networks establish trusted communica-tion paths; trust that is the base for evaluating and adapting to each other’s opinion (see figure 1); trust that an outsider will not have in the community. And by gaining insights about the social architecture of your target group, your messaging can get a boost.

To describe and analyze the social architecture, we characterize the network mainly based on three topo-logical measures (figure 2):

Clustering: How many (independent) social sub segments exist within the market? Centrality: How central are the key players positioned within the market? Distribution of power: How is power distributed among individuals and sub groups within the network?

Managed Intelligence.

© 2011 Mederi AG

Traditional segmentation and targeting models ignore a major dimension for messaging success

For decades pharmaceutical companies have created sophisticated market seg-mentation models to identify relevant stakeholders. These were based on multiple criteria, e.g. geography, functions and roles of stakeholders, groups of interest, and of course impact.

In today’s increasingly connected world, traditional segmentation models miss a dimension that is essential to optimally drive your stakeholder management: the social dimension. This becomes evident if we think about marketing a new electric vehicle. The traditional approach would try to identify the demographic segment most suitable for the type of car. But imagine if you could identify the four col-leagues that regularly discuss automotive technology over lunch at work and tailor a message to exactly meet their specific discussion on the innovative new electric engine and power supply of the car?

SeGMentAtion AnD tArGetinG bASeD on SoCiAl ArCHiteCture leveraging peer relationships for your stakeholder management

Figure 1: Opinion Development within Clusters

Opinions in clusters tend to move towards homogenous states

Opinion 1

Opinion 2

Opinion 3

Figure 1: Opinion Development within Clusters

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Social segmentation and targeting improves brand performance

Applying only traditional stakeholder segmentation and targeting approaches can result in sub optimal marketing

effectiveness. Based on single customer attributes, traditional segmentation models ignore the dependency between

individuals. They group stakeholders into the same segment although they never talk to each other and tear people that

might constantly align on specific brands into separate segments. This results in either elegant theoretical segmentation

models that fail in implementation or in diluted messages that are communicated to the whole market.

In contrast, the social segmentation approach precisely identifies groups of people that influence each other and

therefore are highly correlated in their adoption decision. With this information, synergies in spreading your message

can be leveraged, and barriers to adoption can be identified.

In a clustered market, strategies should be defined to win over cluster by cluster. Gaining a critical mass within each

cluster is crucial. Messages within a cluster can be even more targeted, with limited spill-over and dilution potential

towards other stakeholders. Strategies that target the whole market, such as pushing for a national guideline, will be

much less likely to succeed as in a market that is less clustered.

Based on the network centrality, individual stakeholders will gain or lose in importance. A central, but less active KOL

might be much more impactful in driving adoption than the top expert that is rather isolated. Bridging stakeholders

that link different clusters or stakeholder types can be instrumental to product success, as experienced with medical

experts that have close ties to the crucial reimbursement decision makers.

The distribution of power has even bigger impact within the network: Powerful individuals spread their opinions along

the established relationships. These individuals cannot be engaged just through a direct interaction. Other options

include access through non-competing peers or even through subordinates.

By understanding how the social architecture of a market impacts response behavior of its participants, you can gain powerful insights:

1. How significant is the barrier to market entry?2. What is the best go-to-market strategy, leveraging the existing resources?3. Which social segments should be prioritized within our market?4. What messages should be prioritized within different social segments?

Social segmentation and targeting improves brand performance Applying only traditional stakeholder segmentation and targeting approaches can result in sub optimal marketing effectiveness. Based on single customer attributes, traditional segmentation models ignore the dependency between individuals. They group stakeholders into the same segment although they never talk to each other and tear people that might constantly align on specific brands into separate segments. this results in either elegant theoretical segmentation models that fail in their implementation or in diluted messages that are communicated into the whole market.

in contrast to the traditional segmentation, the social segmentation approach precisely identifies groups of people that influence each other and therefore are highly correlated in their adoption decision. With this information, synergies in spreading your message can be leveraged, and barriers to adoption can be identi-fied.

in a clustered market, strategies should be defined to win over cluster by cluster. Gaining a critical mass within each cluster is crucial. Messages within a cluster can be even more targeted, with limited spill-over and dilution potential towards other stakeholders. Strategies that target the whole market, e.g. pushing for a national guideline, will be much less likely to succeed as in a market that is less clustered.

Based on the network centrality, individual stakeholders will gain or lose in importance. A central, but less active Kol might be much more impactful in driving adoption than the top expert that is rather isolated. Bridging stakeholders that link different clusters or stakeholder types can be instrumental to product suc-cess, as experienced with medical experts that have close ties to crucial reimbursement decision makers.

the distribution of power has even more impact within the network: Powerful individuals spread their opinions along the established relationships. These individuals can be engaged not simply through direct interaction. other options include access through equally powerful, not competing peers or even group pressure from subordinates.

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By understanding how the social architecture of a market impacts response behavior of its participants, you can gain powerful insights:

1. How significant is the market entry barrier?2. What is the best go-to-market strategy with the existing resources?3. Which (social) segments should be prioritized within our market?4. What messages should be prioritized within different (social) segments?

Figure 2: Network topology characteristics

© 2011 Mederi AG

Stakeholder Centrality

Distribution of Power

Network Clustering

Cluster 4

Cluster 3

Cluster 5

Cluster 1

Cluster 2Prof. Dr. R. Miller

Figure 2: Network topology characteristics

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Applying social segmentation for specialty brand

We have identified four key steps to implementing social segmentation in specialty markets (see figure 3).

The first step is to identify social clusters within the market. Although advanced clustering algorithms are available,

we suggest using them only as a starting point. The final design should be based on a cross-functional discussion to

ensure coordinated engagement strategies. Typically, a national market is based on five to ten national key clusters.

The second step then evaluates how well your own and your competitors’ brand positioning fits into each cluster

(see figure 4). Based on this analysis, you can prioritize social clusters by their potential for product adoption and

expected response to your brand messages.

After stack-ranking segments, brand messages are tailored to optimally address the requirements of each relevant

social cluster. Cluster-specific topic maps—which are either based on expert knowledge or derived from large scale

activity data—deliver a foundation for more effective sales and marketing.

Applying social segmentation for specialty brandWe have identified four key steps to implement social segmentation in specialty markets (see figure 3).the first step is to identify social clusters within the market. Although advanced clustering algorithms are available, we suggest using them only as a starting point. the final discussion should be based on a cross functional discussion to ensure later alignment in the engagement process. Typically, a national market is based on 5-10 national key clusters.

the second steps then evaluates how well your own and your competitors’ brand positioning fit to each cluster (see figure 4). based on this analysis, a prioritization of social clusters based on their potential on

product adoption and their expected response to your brand messages can be carried out. in the third step, brand messages are tailored to optimally address the requirements of each relevant social cluster. this process is based on cluster specific topic map, which are either based on expert knowledge or derived from large scale activity data.

Figure 5 shows four examples of cluster focus. each cluster has a unique focus area profile and would require specific messages. Addressing each cluster with the same message would result in 25% – 50% loss of impact. now the real advantage of social segmentation becomes evident: having explicitly selected groups of inter-connected people, social segmentation can push the customization of messages with lim-ited negative spill-over between the clusters.

the fourth and final step translates the cluster specific key messages into an engagement plan. this plan is continuously monitored by the cluster lead, who translates the cluster strategy into individual activities. This ensures optimal impact of short term activities and robust long term relationships.

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Figure 3: Social Segmentation ApproachPlan engagement

with stakeholders / institutions

Response

Potential

Cluster 1

Cluster 2

Cluster 3

Cluster 4

Cluster 5

Cluster Brand Strategy: Cluster characteristics

Target national diabetes events

Focus on key risk factors for diabetes

Only few cluster specific associations

Message Response Profile of Social Cluster

0,0%

5,0%

10,0%

15,0%

20,0%

25,0%

30,0%

35,0%

40,0%Patient Reported Outcomes

Geriatrics

Compliance

DMP

Renal Diseases

Hypoglycemia

Metformin

Side Effects

Cardiovascular Diseases

Metabolic Syndrome

Hypertension

Obesity, Overweight

• (AA) Obesity, Overweight• (A) Hypoglycemia• (B) Metformin• (B) Geriatrics

• (A) Adipositas Stiftung Neu-Isenburg• (A) Deutsche Diabetes-Gesellschfaft• (B) Deutsche Forschungsgesellschaft• (B) DiabetesDE

àLimit resources to hold shared market position within the clusteràPosition brand in the context of obesity and hypoglycemiaàActivate cluster to position obesity topics towards the market access spaceàCreate topic specific (small) events to strengthen inter-cluster connectivityàSponsor topic specific tracks within national diabetes events (e.g. DDG)

• (A) Tagung/Herbsttagung der DDG• (A) Kongresse der DGIM • (A) Herbsttagung für praktische Diab. (DDG)• (B) Viszeralmedizin

• Seeding points: Inside-out (centrality: 132%)• Responsiveness: Medium (connectivity: 109%)• Brand position: Medium, shared position• Cluster Leaders: MSD, BMS; AstraZeneca• Market access impact: Medium (MA connect: 118%)

Create clusters specific brand profile and prioritize messages

Prioritize social segments based on responsiveness and potential

Identify social segments within your market (=clusters)

1 2 3 4

Figure 4: Segment Analysis

0,0%

5,0%

10,0%

15,0%

20,0%

25,0%

Patient Reported Outcomes

Geriatrics

Compliance

DMP

Renal Diseases

Hypoglycemia

Metformin

Side Effects


Metabolic Syndrome

Hypertension

Obesity, Overweight

Cluster

Value Proposition

83% Overlap (weighted dimensions)

+

=

© 2011 Mederi AG

Applying social segmentation for specialty brandWe have identified four key steps to implement social segmentation in specialty markets (see figure 3).the first step is to identify social clusters within the market. Although advanced clustering algorithms are available, we suggest using them only as a starting point. the final discussion should be based on a cross functional discussion to ensure later alignment in the engagement process. Typically, a national market is based on 5-10 national key clusters.

the second steps then evaluates how well your own and your competitors’ brand positioning fit to each cluster (see figure 4). based on this analysis, a prioritization of social clusters based on their potential on

product adoption and their expected response to your brand messages can be carried out. in the third step, brand messages are tailored to optimally address the requirements of each relevant social cluster. this process is based on cluster specific topic map, which are either based on expert knowledge or derived from large scale activity data.

Figure 5 shows four examples of cluster focus. each cluster has a unique focus area profile and would require specific messages. Addressing each cluster with the same message would result in 25% – 50% loss of impact. now the real advantage of social segmentation becomes evident: having explicitly selected groups of inter-connected people, social segmentation can push the customization of messages with lim-ited negative spill-over between the clusters.

the fourth and final step translates the cluster specific key messages into an engagement plan. this plan is continuously monitored by the cluster lead, who translates the cluster strategy into individual activities. This ensures optimal impact of short term activities and robust long term relationships.

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Figure 3: Social Segmentation ApproachPlan engagement

with stakeholders / institutions

Response

Potential

Cluster 1

Cluster 2

Cluster 3

Cluster 4

Cluster 5

Cluster Brand Strategy: Cluster characteristics

Target national diabetes events

Focus on key risk factors for diabetes

Only few cluster specific associations

Message Response Profile of Social Cluster

0,0%

5,0%

10,0%

15,0%

20,0%

25,0%

30,0%

35,0%

40,0%Patient Reported Outcomes

Geriatrics

Compliance

DMP

Renal Diseases

Hypoglycemia

Metformin

Side Effects


Metabolic Syndrome

Hypertension

Obesity, Overweight

• (AA) Obesity, Overweight• (A) Hypoglycemia• (B) Metformin• (B) Geriatrics

• (A) Adipositas Stiftung Neu-Isenburg• (A) Deutsche Diabetes-Gesellschfaft• (B) Deutsche Forschungsgesellschaft• (B) DiabetesDE

àLimit resources to hold shared market position within the clusteràPosition brand in the context of obesity and hypoglycemiaàActivate cluster to position obesity topics towards the market access spaceàCreate topic specific (small) events to strengthen inter-cluster connectivityàSponsor topic specific tracks within national diabetes events (e.g. DDG)

• (A) Tagung/Herbsttagung der DDG• (A) Kongresse der DGIM • (A) Herbsttagung für praktische Diab. (DDG)• (B) Viszeralmedizin

• Seeding points: Inside-out (centrality: 132%)• Responsiveness: Medium (connectivity: 109%)• Brand position: Medium, shared position• Cluster Leaders: MSD, BMS; AstraZeneca• Market access impact: Medium (MA connect: 118%)

Create clusters specific brand profile and prioritize messages

Prioritize social segments based on responsiveness and potential

Identify social segments within your market (=clusters)

1 2 3 4


0,0%

5,0%

10,0%

15,0%

20,0%

25,0%


Geriatrics

Compliance

DMP

Renal Diseases

Hypoglycemia

Metformin

Side Effects


Metabolic Syndrome

Hypertension

Obesity, Overweight

Cluster

Value Proposition

83% Overlap (weighted dimensions)

+

=

© 2011 Mederi AG

Figure 3: Social Segmentation Approach


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Figure 5 shows four examples of cluster focus. Each cluster has a unique focus area profile and requires

specific messages. Addressing each cluster with the same message would result in a 25% – 50% loss of impact.

Now the most strategic advantage of social segmentation becomes clear: having explicitly selected groups

of inter-connected people, social segmentation now enables the customization of messages with limited negative

spill-over across the clusters.

The fourth and final step translates the cluster-specific key messages into an engagement plan. This plan is

continuously monitored by the cluster lead, who translates the cluster strategy into individual activities. With deep

knowledge and key insights, commercial teams can craft more personalized tactics and build long-term relationships.

Making Social Segmentation and Targeting Work for You

Social segmentation and targeting can help you reach a tipping point of stakeholder support, distinguishing you as

a leading brand. Knowing the influence network, leveraging the opportunities, and avoiding the risks this network

provides is a major step towards effective message delivery and market penetration. Furthermore, through social

segmentation and targeting, you gain the ability to communicate with institutional stakeholders who previously were

difficult to reach.

Making social segmentation and targeting work for youWell applied, social segmentation and targeting can help you reach a tipping point of stakeholder support, making the difference between a mediocre and a leading brand. Knowing the influence network, leveraging the opportunities and avoiding the risks this network provides is a major step towards effective message delivery and market penetration. Furthermore, through social segmentation and targeting an opportunity is provided to reach out to institutional stakeholders that previously were hard to reach.

However, applying this tool is not simple: as the industry is just now picking up on this topic, leveraging network influence needs to be learned and integrated into the regular processes. by being at the forefront of this development, a competitive advantage can be achieved.

About the authors: Kilian Weiß is Ceo at Mederi. Germar betz is Consulting Principal at Mederi.

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Mederi AGHanauer landstr. 175-17960314 Frankfurt am MainGermany

t +49 69 2424064-0 F +49 69 [email protected]

© 2011 Mederi AG

Figure 5: Different social segments require different messages

Cluster 1

Cluster 2

Cluster 3

Cluster 4

0%

10%

20%

30%

40%


Geriatrics

Compliance

DMP

Renal Disease

Hypoglycemia

Metformin

Side Effects


Metabolic Syndrome

Hypertension

Obesity, Overweight

0% 1% 2% 3% 4% 5%


Geriatrics

Compliance

DMP

Renal Disease

Hypoglycemia

Metformin

Side Effects


Metabolic Syndrome

Hypertension

Obesity, Overweight

0%

5%

10%

15%

20%


Geriatrics

Compliance

DMP

Renal Disease

Hypoglycemia

Metformin

Side Effects


Metabolic Syndrome

Hypertension

Obesity, Overweight

0% 5%

10% 15% 20% 25%


Geriatrics

Compliance

DMP

Renal Disease

Hypoglycemia

Metformin

Side Effects


Metabolic Syndrome

Hypertension

Obesity, Overweight

Figure 5: Different social segments require different

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Veeva Systems Inc. is a leader in cloud-based software for the global life sciences industry. Committed to innovation, product excellence, and customer success, Veeva has more than 275 customers, ranging from the world’s largest pharmaceutical companies to emerging biotechs. Veeva is headquartered in the San Francisco Bay Area, with offices in Europe, Asia, and Latin America.

For more information, visit www.veeva.com.Veeva Systems4637 Chabot Drive Suite 210Pleasanton, CA 94588 925.452.6500 | [email protected] | veeva.com

Segmentation and Targeting Based on Social Architecture · Social segmentation and targeting...

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